DeeS1 (Michigan)
Posts: 223
Posts: 223
Posted:
Trying to get some opinions ..... ours is a small community with an operating budget under 20K. Historically, we were under the impression and also advised by our management company that we needed to have a yearly compilation review performed by an outside company. The going rate for this in our area is rough $1000-$1200 and represents a significant portion of our budget.
In reading the Michigan Condo act and our Bylaws, I'm curious if this level of formality is required. Both documents state that the "audit" doesn't need to be done by a CPA or certified. My impression is that both an actual "audit" and "review" MUST be preformed by a licensed CPA and certified.
So, if it is not required by the documents to be certified, could the term "audit" and "review" simply be meant to be referring to any "examination and/or evaluation" process done by an outside accountant of the year-end financial statement.
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Michigan Condo Act: The books, records, and contracts concerning the administration and operation of the condominium project shall be available for examination by any of the co-owners and their mortgagees at convenient times and all books and records shall be audited or reviewed by independent accountants annually. Such audits need not be certified.
Bylaws: The books of account shall be audited at least annually by qualified independent auditors; provided, however, that such auditors need not be certified public accountants nor does such audit need to be a certified audit. Any institutional holder of a first mortgage lien on any Unit in the Condominium shall be entitled to receive a copy of such annual audited financial statement within 90 days following the end of the Association's fiscal year upon request therefor.
In reading the Michigan Condo act and our Bylaws, I'm curious if this level of formality is required. Both documents state that the "audit" doesn't need to be done by a CPA or certified. My impression is that both an actual "audit" and "review" MUST be preformed by a licensed CPA and certified.
So, if it is not required by the documents to be certified, could the term "audit" and "review" simply be meant to be referring to any "examination and/or evaluation" process done by an outside accountant of the year-end financial statement.
+++++++++++++++++++++++++++++++
Michigan Condo Act: The books, records, and contracts concerning the administration and operation of the condominium project shall be available for examination by any of the co-owners and their mortgagees at convenient times and all books and records shall be audited or reviewed by independent accountants annually. Such audits need not be certified.
Bylaws: The books of account shall be audited at least annually by qualified independent auditors; provided, however, that such auditors need not be certified public accountants nor does such audit need to be a certified audit. Any institutional holder of a first mortgage lien on any Unit in the Condominium shall be entitled to receive a copy of such annual audited financial statement within 90 days following the end of the Association's fiscal year upon request therefor.